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Salisbury Eyes Tax Differential Once Again

SALISBURY – The City of Salisbury is seeking the opportunity to sit down with Wicomico County to prove it deserves a tax differential. If the city is not successful, officials will have to explore other avenues.

According to Acting Internal Services Director Gerri Moore, under Maryland State Law municipalities have the opportunity to ask the county within which they are located for a tax setoff or a tax differential.

A tax differential is a way for counties in Maryland to compensate municipalities for services that are not provided by the county in those municipalities. This is done by a tax setoff, either reducing the county tax rate in that municipality, or making a payment directly to the municipality for those services.

Similar to what Ocean City does with Worcester, Salisbury has asked Wicomico County for a tax differential since 1999 and every time has been denied. Out of all of the counties in Maryland there are eight mandated to provide a tax set off, and the rest are voluntary.

Councilwoman Laura Mitchell said that while she was in attendance at the Maryland Municipal League (MML) meeting this year Salisbury listed receiving a tax differential from Wicomico County as one of its priorities.

“We need to get on board sending that message to MML that this is important to us, and that we want it considered, and we want it taken as a priority from them to our legislature,” she said.

Council Vice President Deborah Campbell explained that for a number of years it was uncertain whether the county owed the city a tax differential or not. That is why in 2010 a study was conducted by Municipal and Financial Services Group.

The study determined the amount of the proposed setoff. The amount of the setoff proposed is equal to $.082 on the county’s tax rate, or a payment to the city from the county in the amount close to $1.5 million.

“To look at how many years this has been going on, $1.5 million a year starts to add up pretty quickly and you can see the impact of not having that relief,” Campbell said.

Campbell also suggested city officials along with the city taxpayers go directly to the state themselves in order to join the eight counties in Maryland that are mandated to provide a tax set off.

“This is a serious matter and it impacts the finances of our taxpayers,” she said.

The council voted unanimously to approve the mayor sending a letter to Wicomico County requesting a tax differential.